I thank Roger Congleton and the Center for Study of Public Choice at George Mason University in Fairfax, VA, for hosting me at the Center while I was working on this article.
Democracy and prosperity in two decades of transition1
Article first published online: 15 JUL 2011
© 2011 The Author. Economics of Transition © 2011 The European Bank for Reconstruction and Development
Economics of Transition
Volume 19, Issue 4, pages 693–722, October 2011
How to Cite
Apolte, T. (2011), Democracy and prosperity in two decades of transition. Economics of Transition, 19: 693–722. doi: 10.1111/j.1468-0351.2011.00418.x
- Issue published online: 21 SEP 2011
- Article first published online: 15 JUL 2011
- Transition economics;
- public choice;
This article revisits the relationship between democracy, liberalization and prosperity in transition countries, using a panel of 25 countries over 20 years. Earlier investigations found political and economic liberalization to be positively correlated although the relationship between political liberalization and prosperity remained unclear. In this article, the results are ambiguous regarding the relationship between democracy indicators by Freedom House and the Polity Project on one hand and growth on the other. This contribution therefore investigates the component variables of these indicators to determine their degree of influence. The findings suggest that basic constitutional rights and constraints on the government rather than political competition as such may be conducive to both economic liberalization and prosperity in the transition countries.